Washington state transportation funding plan moves forward

Work is underway at the Washington statehouse to move forward a 16-year, $16.8 billion transportation funding package.

The state Senate voted 29-20 on Tuesday, Feb. 15 to advance the lead bill, SB5974, in the four-bill package. The second Senate bill, SB5975, awaits further action in the Senate. The House versions are HB2118 and HB2119.

The Democrat-led Legislature says the transportation spending and revenue package does not include an increase on the state’s 49.4-cent fuel tax rate on gas and diesel.

“We heard loud and clear that working families are still facing the brunt of an economic burden caused by the pandemic,” Senate Transportation Chairman Marko Liias said during a video conference. “That’s why there is no gas tax in this package.”

The transportation funding package does include more than $2 billion in additional vehicles fees. Local governments also would get more taxing authority.

Move Ahead Washington

Dubbed “Move Ahead Washington,” the four-bill package would provide money for purposes that include highway repairs and construction, bridge replacements, and ferries.

In lieu of a tax increase on gas and diesel purchases in the state, the bill package would include a 6-cent-per-gallon export tax collected at the wholesale level.

Gas and diesel fuel shipped from refineries in Washington to states with tax rates less than 49.4 cents would be charged the export tax. Specifically, the tax would be collected on fuel exported to Alaska, Idaho and Oregon.

Alaska has an 8.95-cent fuel tax rate. Idaho has a 33-cent rate and Oregon has a 38.5-cent rate on gas and diesel fuel.

The state of Oregon would face the brunt of the tax. According to the U.S. Energy Information Administration, Oregon receives more than 90% of the refined products it uses from the state of Washington.

The export tax is estimated to raise $2 billion over the life of the legislation.

Bill supporters say the export tax would not be unique to the state of Washington.

Liias said that Florida, Texas and Tennessee have taxes that they apply to exported fuel from their in-state refineries.

Where the money is slotted

The transportation funding bill package would route $3 billion each to highway improvements and transit. Another $1.3 billion would be used to build four hybrid-electric fees and electrify two ships run by Washington State Ferries.

Additionally, the bill package would access billions in federal funds and a one-time $2 billion transfer from the state’s operating budget. An additional $5.4 billion would come from a climate bill approved last year by legislators.

The legislative package is not without detractors.

Senate Republicans point out the package would raise 14 taxes and fees. They add that the plan received little public input.

GOP lawmakers also complain that they were left out of the process to craft the bill package. Multiple legislators called for amending proposed tax and fee increases.

Sen. Mike Padden, R-Spokane, pushed for a change to use state sales tax on vehicles to support transportation.

“People are surprised this is not already happening,” Padden said. “This would eliminate the need for the taxes and fees in the Democratic SB5974.”

The Democrats’ transportation plan (SB 5974) even punishes non-drivers through potential 2% tax hikes on phones and heating homes with natural gas. What do phones and natural gas have to do with transportation?! #waleg #UnaffordableWA pic.twitter.com/Vftp5mTNbH

— WA Senate Republicans (@WashingtonSRC) February 15, 2022

Liias said time constraints due to the 60-day session prevented Senate leaders from drawing out the process to consider many concerns. LL

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